Spain's left-wing government passed a controversial pension reform that was rubber-stamped by the trade unions but sharply criticized by business leaders and the conservative opposition.
The plan was approved by the Council of Ministers in Madrid on Thursday, but must still pass parliament, where the minority government of Prime Minister Pedro Sánchez is often supported by smaller parties.
The pension reform fulfils a demand of the European Union, which had made further disbursements of funds tp Spain from its Corona Reconstruction Fund dependent on it. It also aims to ensure that the pension system remains financially sustainable, as the biggest challenge ahead is the imminent retirement of the baby boomers.
Among other things, the income of the pension fund is to be improved by a slow but steady increase in contributions. At the same time, state subsidies and lower pensions are to be increased. The introduction of a "solidarity quota" for the social contributions of higher earners is also envisaged.
The conservative People's Party (PP) of opposition leader Alberto Núñez Feijóo rejected above all the planned increase in contributions as a "new tax on labour and talent." The party said it would reform the pension system again if it won the elections at the end of the year and returned to power.
Unlike in France, where mass protests faced Emmanuel Macron's government, which pushed its own pension reform through parliament on Thursday, there have been no such conflicts in Spain despite heated debates.
The French plan would raise the retirement age to 64 from 62. By contrast, in Spain, the retirement age is not the burning issue as this has been gradually raised since 2013 and will reach 67 by 2027.
